Policyholders who have been with their insurer for two years or more can slash their premiums, writes John Cradden
If you have private health insurance, there's a good chance that you'll need to renew your policy this month, but why not switch instead and save hundreds, if not thousands?
The bottom line is that anyone who is on the same plan for two years or more stands to save money, according to health insurance broker and expert Dermot Goode of Totalhealthcover.ie.
Using the example of a family of two adults and two children under 18 who are insured on a quality mid-range plan covering public and private hospitals, he said: "If they have not reviewed their cover in the past 2-3 years, they could be missing out on potential savings of €740 to €3,100 depending on the plan held and which insurer they're with."
What's more, a family who have been on an entry-level plan for some time can save up to €950 and still double their benefits to include public and private hospital cover.
Older individuals on dated higher-level plans also stand to make substantial savings by switching, according to a recent survey by the Health Insurance Authority (HIA).
The savings for younger policyholders may not be as substantial, but someone in their 30s with a public hospital cover and semi-private room in a private hospital could knock €500 off their premium by switching insurer and increasing their excess from €125 to €250.
With the average premium per person last year now close to €1,200, why have costs been rising so much again? Goode says a number of factors are to blame, including an aging population that is claiming more frequently, and new technologies and drugs that are pushing up the cost of claims.
But one of the biggest single drivers of higher prices this year has been the decision of former Health Minister James Reilly to impose charges on health insurers when people with private medical cover use a public hospital. Changes in the law in 2014 allow public hospitals to charge health insurance customers even when they do not receive private treatment.
Before that, insurers were only charged when a person got a designated bed.
"This practice is probably adding at least 5pc per annum to our policies," said Goode, who adds that more consumers are making claims for private hospital treatments to avoid the lengthy waiting times of the public system.
"Unfortunately, consumers need to be budgeting for 8pc-10pc increases per annum, but those who have never reviewed their cover, especially older members, stand to make the biggest savings by shopping around."
Some 400,000 policies are due for renewal in January, but just less than a quarter of policyholders have ever switched providers, according to the HIA.
"The range of insurance plans on offer is changing and becoming more competitive all the time," said HIA chief executive Don Gallagher. "Personal and family circumstances also change and this can change the level or type of health insurance needed. Someone who hasn't reviewed their level of cover, and the price they are paying, in the last three years is unlikely to be getting the best value they can for the cover they need. Switching health insurance product or provider is a very straightforward and easy process."
But while switching health insurer can clearly provide dividends in the form of often huge savings on premiums, at least one of the factors putting off some from even researching alternative providers and plans is the bewildering array of plans available.
Goode says things have improved in this regard in that some insurers have removed some of their most dated plans and information on the best deals is now more accessible on their websites.
"There has been a marked improvement in the level of information available online from the health insurers, so it's also worthwhile checking out their websites as well, starting with your current provider."
You can also check out the HIA's website, which has a searchable database of all the plans available and allows you to compare plans. "One point to note is that the HIA are there to provide information only and are not permitted to give any advice on health insurance options. Consumers should use the information to then engage with the health insurers on the specific plans they wish to consider."
While he advises consumers to do their research online, it is better to contact insurers or a broker to make sure it meets your needs.
"It is recommended that you never buy your plan online as you are then responsible for making sure that it meets your exact requirements as you have not received any advice from the insurer.
"By phoning the insurer, they then must explain everything to you in detail and all calls are recorded as well."
However, the online-only option is still there if you've left it to the last minute and need cover immediately.
How to switch ...Health insurance
Find out what the name of your current plan is and how much your renewal premium is (eg Vhi Family Plan Level 1; Laya Flex 125 Explore). Decide what your budget is this year.
Visit the Health Information Authority's website, www.hia.ie, and use its comparison facility to compare this plan with others on the market, side by side.
Talk to your insurer or a broker. Ask them: "What is your very best plan for my budget and please include all your corporate plans." If you are considering upgrading or downgrading your plan, it will be well worth talking to them about this, too. They could also advise on any discounts that might be available, any premium reductions possible by, for example, increasing your excess, or alternative plans that may give you more benefits for the same premium.
Potential saving: €250 (courtesy of hia.ie and based on a single individual in their 30s on a public hospital plan that includes semi-private room in a private hospital)
Total time: 30 mins